Lease Accounting Rules Set for Simplification by Global Board

Standard-setters agreed Tuesday to consider simplifying global lease accounting rules that companies have criticized for their cost and complexity.

All 13 members of the International Accounting Standards Board voted to research ways to improve the rules. Companies are currently required to account for lease contracts as if they were loan agreements, putting debt on the balance sheet and forcing firms to split rentals between capital and interest payments.

Feedback from companies using the rules found them costly and complex.

The board plans to look into letting companies remeasure their lease liabilities less frequently and simplifying the discount rates used to ...